ISTANBUL 

The “world’s lowest fertility rate” plaguing South Korea needs to become a priority for Seoul, the Organization for Economic Cooperation and Development (OECD) said in a statement on Thursday. 

South Korea’s birth rate fell to 0.7 in 2023, a number the OECD calls a hindrance to long-term economic growth, as the country is facing challenges to its aging population and labor market constraints.

The OECD Economic Survey of Korea estimates the country’s GDP growth at 2.6% in 2024, and 2.2% in 2025, up from 1.4% in 2023.

Inflation is projected to fall from 3.6% in 2023 to 2.5%, according to the OECD, providing space to ease monetary policy.

The OECD recommendations for enhancing the South Korean labor market are improving the work-life balance, narrowing the gender gap, supporting working parents, and lowering education and accommodation costs, as well as encouraging older people to keep working, lowering the employment age, and attracting high-skilled migrant workers.

Additionally, the OECD said that boosting the productivity of small and medium-sized enterprises (SMEs) should be prioritized through combining already existing support programs into fewer but more focused ones and removing regulatory barriers to ensure fair competition.

The organization said South Korea is one of the most energy-intensive economies among the OECD member states, urging the country to improve its energy efficiency efforts and implement regulations in the electricity sector.

Emphasizing the need to reduce greenhouse emissions, the organization added that South Korea’s emission limits need to be lowered even more to reach the target of 40% fewer emissions by 2030.